Moody's upgraded the credit rating of Lenenergo PJSC from Ba2 to Ba1 and the  probability of default rating of" Lenenergo" PJSC from Ba2-PD to Ba1-PD. Rating outlook is" stable".

On December 7, 2017, the international rating agency Moody's Investors Service (“Moody's”) upgraded corporate family credit ratings and probability of default ratings of the power grid company PJSC Rosseti and its regional power grid subsidiaries (PJSC" IDGC", PJSC" Lenenergo", PJSC" IDGC of Center and Volga Region, OJSC "IDGC of Urals", PJSC "IDGC of Volga") from Ba2 to Ba1 and from Ba2-PD to Ba1-PD, respectively. Rating of all outlook is" stable".

“The increase in the rating of PJSC Rosseti group companies is a consequence of the agency’s assessment of its strong financial performance and its dominant position in the Russian electric grid market, and also takes into account the fact that the current state regulation of the electric grid sector provides companies with reimbursement of operating and, in some cases, delays, investment costs,” said Moody's.

According to Moody’s, the upgrade of PJSC" Rosseti" and regional distribution grid companies reflects the agency’s following findings: 1) despite the fact that the regulation of the electric grid sector in Russia is in the process of formation, it nevertheless provides timely reimbursement of companies transaction costs, and also to a large extent guarantees the return on investment in infrastructure development with acceptable profitability, albeit with deferrals ; (2) the risk of a significant reduction in the volume of electricity transmission by group companies in the future is limited due to their dominant position in most markets; (3) financial performance of companies improved after weakening in 2015 and are strong for the current rating category, and (4) liquidity of companies is at a good level.The full text of the press release published by Moody’s can be found on the official website of the rating agency (https://www.moodys.com/) or on the website of Lenenergo PJSC in the section “For Shareholders and Investors”.

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